Noncompete agreements generally prohibit former employees from joining a competing organization for some specified length of time after the employment relationship ends. Some agreements restrict competitive activity even before the relationship ends. In the absence of such an agreement, many employees might assume that they are free to start competing…
When I wrote about how to enforce a noncompete agreement against a departed employee a couple of years ago, I made it sound pretty easy: write an enforceable noncompete agreement, then move for a preliminary injunction to prevent the employee from doing further damage to your business. It should be…
Under Federal Rule of Evidence 802, hearsay evidence is generally not admissible in court. In preliminary injunction proceedings, however, the rules of evidence don’t necessarily apply. Here in the Fourth Circuit, courts relax evidentiary rules when faced with motions for preliminary injunctive relief, mostly due to practical considerations such as…
Noncompete agreements are typically found in employment agreements between employers and their employees. But that’s not the only place these clauses are found. Sometimes you’ll have two sophisticated companies of roughly equal bargaining power who, for whatever reason, wish to enter into a binding agreement placing restrictions on the one…
Once upon a time, courts would routinely dismiss non-compete lawsuits brought by businesses against their former employees if the agreements at issue appeared to impose an unreasonable burden on the employee’s ability to earn a living. The rules of the game changed a bit back in 2013 when the Virginia…
When the Virginia Supreme Court decided Assurance Data v. Malyevac a few years ago, most employment lawyers speculated that although Virginia law no longer permitted most non-compete cases to be disposed of summarily on demurrer, a procedural mechanism known as the “plea in bar” could still be used by defendants…
The best way to predict whether a particular noncompete clause will be deemed enforceable in a Virginia court is to read about how similar clauses have been treated by those same courts. No two cases are exactly alike, but non-compete agreements tend to incorporate similar language (mostly for the reason…
It happens to every business eventually. A rogue employee defects to a competitor and immediately starts soliciting the former employer’s customers and clients, using the former employer’s trade secrets or other confidential commercial information against it. Although non-compete and non-solicitation agreements are generally disfavored in Virginia, most Virginia judges nevertheless…
Restrictive covenants in employment agreements (e.g., noncompete and nonsolicitation clauses) are enforceable in Virginia if they are (1) narrowly drawn to protect the employer’s legitimate business interests, (2) not unduly burdensome on the employee’s ability to earn a living, and (3) are not against public policy. There was once a…
The “janitor test” isn’t the only hypothetical scenario that, when applied to a non-compete agreement governed by Virginia law, can render the contract unenforceable. In NVR, Inc. v. David Nelson, the federal court in Alexandria imagined a number of hypothetical situations when struggling to interpret an ambiguous geographic limitation in…